Telefonaktiebolaget L M EricssonERIXF 59 Pretax Margin % is 2.53% as of Mar. 2026, which is 2% below its 10-year median of 2.59. GuruFocus rates ERIXF with a GF Score™ of 59/100 and a GF Value™ of $7.38 (Significantly Overvalued). The stock has 3 warning signs investors should review. Among 2,471 Hardware companies, Telefonaktiebolaget L M Ericsson ranks better than 84.14% on this metric.
The historical rank and industry rank for Telefonaktiebolaget L M Ericsson's Pretax Margin % or its related term are showing as below:
ERIXF'
s Pretax Margin % Range Over the Past 10 Years
Min: -17.51 Med: 2.59 Max: 16.18
Current: 14.59
ERIXF's Pretax Margin % is ranked better than 84.14% of 2471
companies
in the Hardware industry
Industry Median: 3.58
vs ERIXF: 14.59
Telefonaktiebolaget L M Ericsson (OTCPK:ERIXF) Pretax Margin % Explanation
The pretax margin, as know as pretax profit margin, is widely used to measure the operating efficiency of a company before deducting taxes.
The pretax margin is sometimes preferred over the net margin as tax expenditures can make profitability comparisons between companies misleading.
It is a useful tool to compare companies operating in the same sector and less effective when comparing companies from other sectors as each industry generally has different operating expenses and sales patterns.
The long term trend of the pretax margin is a good indicator of the competitiveness and health of the business.
Telefonaktiebolaget L M Ericsson Pretax Margin % Related Terms
Telefonaktiebolaget L M Ericsson Pretax Margin % Historical Data
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
Telefonaktiebolaget L M Ericsson Pretax Margin % Chart
ERIXF vs CSCO, CIEN, MSI: Pretax Margin % Comparison
For the Communication Equipment subindustry, Telefonaktiebolaget L M Ericsson's Pretax Margin %, along with its competitors' market caps and Pretax Margin % data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
Telefonaktiebolaget L M Ericsson Pretax Margin % vs Hardware Industry
For the Hardware industry and Technology sector, Telefonaktiebolaget L M Ericsson's Pretax Margin % distribution charts can be found below:
* The bar in red indicates where Telefonaktiebolaget L M Ericsson's Pretax Margin % falls into.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
Telefonaktiebolaget L M Ericsson (ERIXF) has a Pretax Margin % of 2.53% as of Mar. 2026. Pre-Tax margin is the ratio of total pre-tax income to net sales. View historical data on Telefonaktiebolaget L M Ericsson and its competitors. This is near median its historical median of 2.59. According to the industry distribution chart, Telefonaktiebolaget L M Ericsson ranks #392 out of 2471 companies in the Hardware industry, placing it in the top 15.9%.
Is Telefonaktiebolaget L M Ericsson's Pretax Margin % too high?
Telefonaktiebolaget L M Ericsson's current Pretax Margin % of 2.53% is near median its 10-year median of 2.59. The Hardware industry median Pretax Margin % is 3.58. Telefonaktiebolaget L M Ericsson's value of 2.53% is 29.3% below this industry median. Based on the distribution chart, Telefonaktiebolaget L M Ericsson ranks #392 out of 2471 companies in the Hardware industry, which is in the top quartile — a strong position relative to peers. Overall, Telefonaktiebolaget L M Ericsson has a GF Score™ of 59/100 and is considered Significantly Overvalued, reflecting its overall financial health beyond just this single metric.
How does Telefonaktiebolaget L M Ericsson's Pretax Margin % compare to CSCO and CIEN?
According to the Hardware industry distribution chart, Telefonaktiebolaget L M Ericsson ranks #392 out of 2471 companies for Pretax Margin %. This places Telefonaktiebolaget L M Ericsson in the top 16% of its industry — outperforming the majority of peers. The industry median Pretax Margin % is 3.58. Telefonaktiebolaget L M Ericsson's value of 2.53% is 29.3% below this benchmark. While the company's 10-year median is 2.59 vs. the industry median of 3.58, Telefonaktiebolaget L M Ericsson has consistently been below the industry average. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good Pretax Margin % for a Hardware company?
The median Pretax Margin % among Hardware companies is 3.58, based on 2,471 companies in the industry. Companies in the top quartile (top 25%) have a Pretax Margin % significantly above this median, while those in the bottom quartile fall well below. However, Pretax Margin % should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Telefonaktiebolaget L M Ericsson's current Pretax Margin % of 2.53% is 29.3% below the industry median. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high Pretax Margin % mean?
A high Pretax Margin % can signal that a stock is expensive relative to its fundamentals. Pre-Tax margin is the ratio of total pre-tax income to net sales. View historical data on Telefonaktiebolaget L M Ericsson and its competitors. For the Hardware industry, the median Pretax Margin % is 3.58 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Telefonaktiebolaget L M Ericsson's current Pretax Margin % is 2.53%, which is near median its own 10-year median of 2.59. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Telefonaktiebolaget L M Ericsson stock overvalued right now?
Based on GuruFocus' analysis, Telefonaktiebolaget L M Ericsson (ERIXF) is currently considered Significantly Overvalued. The stock's GF Value™ is $7.38, compared to a current price of $11.42 — trading 54.7% above its estimated fair value. The current Pretax Margin % is 2.53%, which is near median its 10-year median of 2.59 and 29.3% below the Hardware industry median of 3.58. Telefonaktiebolaget L M Ericsson's overall GF Score™ is 59/100 with 3 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is Pretax Margin % calculated?
Pretax Margin % is calculated from a company's financial statements. For Telefonaktiebolaget L M Ericsson (ERIXF), the current Pretax Margin % is 2.53% as of Mar. 2026. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Is Telefonaktiebolaget L M Ericsson (ERIXF) Overvalued in 2026?
Based on GuruFocus' analysis, Telefonaktiebolaget L M Ericsson stock appears to be overvalued.
The current stock price of $11.42 is trading 54.7% above its estimated GF Value™ of $7.38.
GuruFocus considers Telefonaktiebolaget L M Ericsson to be Significantly Overvalued.
Key valuation signals for ERIXF:
Pretax Margin %: 2.53% (near median its 10-year median of 2.59)
GF Value™: $7.38 vs. price of $11.42 (54.7% above fair value)
Industry Position: 29.3% below the Hardware median (#392 of 2471)
No single metric tells the full story. See the ERIXF stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Telefonaktiebolaget L M Ericsson Business Description
Ericsson is a networking equipment and software provider, primarily selling mobile networking equipment and services to wireless service providers. Ericsson operates in three segments: networks, cloud software and services, and enterprise. While large wireless carriers are its largest customers, Ericsson has expanded its offerings for large enterprises. These products and services include private 5G networking, contact centers as a service, and application performance interfaces. Ericsson aims to combine its 5G network expertise with cloud-native, as-a-service platforms offering a more comprehensive hardware and software package. Ericsson also monetizes its research and development investments by licensing patents to handset manufacturers.
59GF Score
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